New powers given to the Queensland Building and Construction Commission to ensure building companies have enough financial backing has resulted in a big windfall.
The $122 million capital injection comes from companies which were found to be operating with insufficient assets to support their turnover.
The capital increase followed financial reviews of 269 licensees by the QBCC.
The state’s construction watchdog has been compelling companies to raise and maintain an adequate level of working capital, in a step to reduce the risk of instability.
The new laws brought in by the Palaszczuk Government in January handed the QBCC the power to examine the building and construction regulatory system, taking aim at licensees operating with unhealthy financial circumstances.
More than 1,400 companies in the state’s construction industry entered administration over the past five years.
Along with minimum financial requirements changes, the Queensland government set in motion a building industry taskforce — headed by former Supreme Court justice John Byrne — to expose illegal or fraudulent activity within Queensland’s $46 billion a year construction industry.
Since the January announcement, the QBCC has suspended the Queensland licences of a number of builders including Melbourne developer Simonds Group, De Luca Corp and Laing O’Rourke’s Australian arm all of which reclaimed their licences after agreeing to align finances.
“If a licensee doesn’t have the asset base to support its turnover, we know that can be a recipe for disaster,” Minister for housing and public works Mick de Brenni said.
“The QBCC has told me they will take swift regulatory action against any licensee failing to meet the financial requirements.”
Over the course of 2018, QBCC inspected approximately 5,820 sites and issued 827 Directions to Rectify.
“There is no law that can provide an iron clad guarantee against business failure or financial mismanagement, but people who invest in Queensland and workers who establish their career in Queensland need to be given the highest possible security that Queensland has a strong, stable building industry,” de Brenni said.
“While the audit continues, these results, before we’ve even reached a half way mark, demonstrate the importance of obtaining these safeguards.
